Today the Business Secretary Vince Cable spoke about the Government's industrial strategy. One of the polices that were mentioned was the idea of introducing a business bank, and I asked him about this;
I thank the Secretary of State for his personal support for the life sciences sector in east Kent. If there is to be public money behind any partnership, will he particularly consider equity so that the taxpayer can share in the success? Will he also consider the idea that the proposed industrial bank should be the business growth fund retasked, expanded and floated for the future?
It is certainly true that in developing the idea of an industrial business bank, we need to take account of existing mechanisms of funding and bring them together in a more rational way. I thank the hon. Gentleman for what he said about east Kent, which is a good example of how, even in successful growth industries such as the life sciences, technologies change, competition is intense and companies close. A large part of government is dealing with the painful restructuring that has to happen. We cannot stop markets from working.
UPDATE: On 24 September Vince Cable announced the business bank would become a reality
"We need a British business bank with a clean balance sheet and a mandate to expand lending rapidly and we are now going to get it.
"Alongside the private sector, the bank will get the market lending to manufacturers, exporters and growth companies that so desperately need support. It will be a lasting monument to our determination to reshape finance so it can finally serve industry the way it should. Its success will not be the scale of its own direct interventions but how far it shakes up the market in business finance and helps to ease constraints for high-growth firms.
"Having a functioning, diverse supply of finance is an integral part of the Government's industrial strategy. It is all about making the right decisions now to secure our long-term industrial success."
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